Calculator for Loan with Monthly Offset Account

jeeg on 18/09/2016 - 17:02

Hi, I am looking for an online calculator that does this:

Say with a fixed loan amount (500K for discussion sake) and an initial offset balance (say $50K) and an additional monthly offset top up of say $2K, calculate the amount of principal and interest each month.

I can find plenty of online calculator that consider an initial offset but cannot find one that includes a monthly offset top up.

Greatly appreciate if somneone knows how to calculate this or point me to a right URL for this.

Thanks

Financial

Comments

  • TheMatrix on 18/09/2016 - 17:33

    Depend if you have a full or partial offset account. Assuming you have a full offset account, ie balance in your offset account is used to fully offset your loan balance, then your monthly additional top up depend on what day during that month you put in the extra amount into your offset account. ie at the beginning or end of month etc, this would affect the interest you end up paying… so it would vary….you have to compute each month depending on when you put in the extra amount and how much exactly….

    • jeeg on 18/09/2016 - 17:35

      Thanks. It is a full offset account I have in mind. I wanted to know if I put in a fixed $X as offset in the bank, what is the impact this will be on my monthly payment and interest.

      • TheMatrix on 18/09/2016 - 17:44

        If you put in an initial $y amount into your offset account, and you have a loan (Z). You are effectively paying interest on the amount of (Z-Y). Let say you put in extra $X at the beginning (day 1) of your loan cycle, then you are effectively paying the interest on the amount of (Z-Y-X). But if you put in X on day 5 instead of day 1, then interest on your loan would be different again…..interest are calculated daily on your loan balance minus the balance in your offset account.

        • jeeg on 18/09/2016 - 17:45

          Thanks I understand the logic behind the calculation. But just wish to have an online calculator (or an excel spreadsheet) so I can experiment with numbers. I am assuming I deposit that $X on day 1 of the loan cycle for simplicity.

        • stratbargain on 18/09/2016 - 17:51

          @jeeg:

          http://www.nab.com.au/mkfsiR2/resources/homeside.html

          I'm sure there are many but I've used the one above in the past

        • jeeg on 18/09/2016 - 17:53

          @stratbargain:

          Thanks. This calculator has an input for an offset account balance but has no input for additional monthly offset top up each month….not exactly what I am hoping for….

        • jeeg on 18/09/2016 - 18:07

          @TheMatrix:

          Sorry I don't mean to be ungrateful for the help you have given. I am really thankful for your help.

          I just tried the calculator, it has a input for extra repayment each month but that repayment is used as principal+interest payment. It does not calculate what is the resulting principal and interest if I choose to deposit that $X into an offset account instead.

          Say I have a $500K loan with a $50k offset account from day 1. I wanted to deposit $2K each month on top of my loan amount. BUT I want to grow my offset account balance…so on the first year I would have grown $50k to $74K and another $24K on the next. What is the effect of this on my interest payment to the bank.

        • TheMatrix on 18/09/2016 - 18:40

          @jeeg: I realized that after I posted the link….. make me think…..I believed the net effect is the same, except the extra repayment would sit in your loan account rather than your offset account, these extra repayments you accumulate each month can be taken out (or transfer to your offset account if you like), it would show up as amount available for withdrawal in your loan account (which in effect is like an offset amount… it decrease your effective loan balance….

          But I do understand what you are trying to do……

        • jeeg on 18/09/2016 - 19:05

          @TheMatrix:

          Thanks Buddy. I appreciate your help nonetheless.

        • TheMatrix on 18/09/2016 - 19:26
          +2

          @jeeg:
          This is what you are looking for, I believed.
          https://www.amp.com.au/calculators/offset/app.html

        • jeeg on 18/09/2016 - 19:37

          @TheMatrix:

          Thanks mate!! Exactly what I need!! I don't know how you do your googlefu but your fu is stronger than mine! Cheers mate.

  • MT2010 on 18/09/2016 - 18:58

    http://www.tvmcalcs.com/calculators/apps/excel_loan_amortiza…

    try downloading the excel spreadsheet link in the last paragraph - maybe this is what u requires.

    • jeeg on 18/09/2016 - 19:05

      Thanks I have downloaded this. The additional principal input is related to money used to pay into the loan. not as an offset.
      I have tried to google and google for a spreadsheet but I just couldn't find any. sigh.

  • MT2010 on 18/09/2016 - 19:09

    Additional payments going into your offset account is the same as additional payments going into your loan account. I think maybe the bank loan officer can clarify this for you. The paragraph below is from google. All the best.

    An offset account is a transaction account linked to an eligible home or investment loan. The money you have in this account could offset the amount you owe on that loan, and you'll only be charged the interest on the difference.

    • jeeg on 18/09/2016 - 19:10

      Thanks mate.

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